How can I make a depression effect on an image?

I am making a poster for Veterans Day.  I have an image of a pair of hands palms up, slightly cupped.  I have another image of a Flag.  I want to place the flag in the cupped hands, and have the flag appear as if it is laying within those cupped hands.  The best way I know to describe my desired effect is if you think of a "reversed bloat" using the Distort Filter, but I can't seem to find that.  Does that make sense?  Any suggestions? PSD attached. I'm using PSE 2020 on a Windows 10 platform.